Mortgage rates inch higher

Tribune News Service

Mortgage rates inched higher amid news this past week that higher prices are persisting for most household products.

The average mortgage interest rate for a standard 30-year fixed mortgage is 7.40%, an increase of 0.08 percentage points from the previous week’s 7.32%.

Thirty-year fixed mortgages are the most commonly sought out loan term. A 30-year fixed rate mortgage has a lower monthly payment than a 15-year one, but usually has a higher interest rate.

The average mortgage interest rate for a standard 15-year fixed mortgage is 6.64%, an increase of 0.02 percentage points from the previous week’s 6.62%.

Fifteen-year fixed rate mortgages come with a higher monthly payment compared to 30-year rates.

However, usually interest rates are lower and you will pay less total interest because you are paying off your loan at a faster rate.

The average rate on a 5/1 adjustable rate mortgage (ARM) is 6.40%, an increase of 0.06 percentage points from last week’s 6.34%.

With an ARM, you will often get a lower interest rate than a fixed mortgage for say, the first five years.

But you could end up paying more or less after that time depending on your loan terms and how that rate follows the market.